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H. James Harrington

Quality Insider

Are Quality Methodologies All Smoke and Mirrors? Part Two

If GM Can’t, Why Can’t They?

Published: Thursday, October 1, 2009 - 04:00

Two months ago my column “Are Quality Methodologies All Smoke and Mirrors? Part One” was a review of my interview in 1988 with F. James Mc Donald, the CEO of General Motors Corp. at that time. The interview focused on what GM was doing to bring about a radical change in the quality of all of their products.

McDonald said the things that any quality professional wants CEOs to say:

  • He recognized that the playing field had changed and that the company had new benchmarks.
  • He stated that quality is the No. 1 operating priority at GM.
  • He stated that quality objectives and strategies are part of their five-year business plan.
  • He had GM doing concurrent design with early supplier involvement.
  • They had strategic vision and that vision was simply to offer world-class quality in every market segment. By “world-class,” he explained that GM must be equal to or better than the best in the field, product for product.

  • The company had four key success factors:
    1. Management commitment
    2. People development processes
    3. Quality performance processes
    4. Customer satisfaction
  • He stated that GM must be the world leader in quality, reliability, durability, performance, service, and value, as confirmed by customer-defined measures and market response.
  • He made the top managers in each company totally responsible for achieving the objectives and implementing the strategies.
  • He had more than 30,000 employees trained related to performance improvement.
  • He recognized that GM needed to stop being the best at problem solving and instead become proficient at preventing problems.
  • He required management at all levels to be committed to the plan and demonstrate their commitment by word and action.
  • He made GM's  U.S. passenger cars and its worldwide truck and bus operations address changes necessary to improve quality. He made management accountable for improvement, effective allocation of resources, and results.

 

In reviewing McDonald’s comment, I see that he was saying and doing all the right things. But the results have been disastrous for GM investors, employees, suppliers, and the United States in general. Saying and doing the right things is admirable, but as GM has proven, it is the way you do things—how managers behave, how they spend their time, and what they are interested in that makes a difference. Was McDonald really serious when he said that GM must be the leader in quality, reliability, durability, performance, service, and value as confirmed by customer-defined measurements and market responses?

In my previous article, I asked for input from the readers about what they thought was the reason GM products are still inferior to Toyota after more than 20 years of trying to improve. I was flooded with phone calls, comments, and news all from past GM owners and potential GM buyers. I was very disappointed that I did not receive any input from the management team from GM. I can only assume that GM management does not understand why the quality program did not work for them.

Plenty of times in the last 20 years, they had to correct their many quality product and services problems. I used as my benchmarks, Korean cars that started from scratch about the same time and today are providing quality cars comparable to those from Toyota.

The following is a summary of the comments I received starting with the most frequent comment:

  1. "Too much focus on quality tools that did not improve profit but took focus away from the market"
  2. "GM is too big and too slow to react to change rapidly enough."
  3. "Very poor GM management team"
  4. "Poor reliability"
  5. "Lack of team work and trust for union, management, and employees"
  6. "It started too late"
  7. "Too much pressure applied on their suppliers and not enough work on GM’s own processes"
  8. "Poor customer focus"
  9. "Poor/untrained dealers"
  10. "Poor production process, not quality focused"

 

I’m not going to take a position during this column about the views of GM customers and potential customers. I am only capturing and summarizing their inputs. I will share my views on the subject in a later column.

1. Too much focus on quality tools, not enough focus on the market. GM spent lots of time, effort, and money doing the fad of the week. There were many claims of dollar savings that did not reflect in GM’s profits or customers’ satisfaction. The activity regarding compliance to standards of the International Organization for Standardization (ISO) just added more bureaucracy to an already over burdened system that resulted in little or no improvement. They should have spent the time and money finding out what the customer wanted rather than focusing teams on improving things that the customer didn’t want.

2. Too big and too slow. With eight levels or more of management, customers believe that the GM workers’ concerns are not heard by management. Likewise top management’s words are filtered so many times before they reach the workers that they are completely distorted. GM culture is one of “Don’t stick your neck out; do it the way you have been doing it. Don’t change; slow down so that there’s work enough for everyone.”

3. Poor management. Lots of talk, little action, and no change. McDonald’s answers were textbook answers. It looks like they were written by their quality assurance vice president with little or no level of creativity. General Motors’ management was not and is not committed. They get big pay checks for poor results, while a GM worker is fired for producing poor results. The management team is all blow and no show. As there were management changes in leadership positions, there was lack of follow through on improvement programs.

4. Poor reliability. When I had a GM car, I had to keep a list of things I needed to get repaired. When I switched to a Toyota, there was nothing to put on the list, so I did away with it. GM designs a car for 250,000 miles and then uses parts that fail every 20,000 or less miles. Quality is not designed into GM cars and it must be if they are going to recapture their reputation and stop losing market share.

5. Lack of team work and trust among management, union, and the workers. The GM culture is one where you look out for yourself. Management does not really care about the employees. They look at them as an expense rather than as an asset. The union tries to get all they can without caring about the effect on GM’s competitive position. Management has not earned the trust of their employees so the employees have to look out for themselves with the union’s help. Even within the employees and management personnel there’s a dog-eat-dog environment.

6. Started too late. GM did not care about quality until Japan stole their market share. They waited until their reputation was ruined and then they tried to catch up. Their objective is to be as good as Toyota. What they really need to do is to rebuild their reputation. They need to become much better than Toyota if they want to be given a second chance.

 

I’m stopping here, as I believe you have an idea of what the customer and the potential customers of GM feel are their problems. Now we are all paying out of our pockets the high salaries that the GM executives are getting. We have the same team of people doing the same thing in a bankrupt company that they were doing before, but now it is being supported by you and me, even if we do not buy a GM car. The only change is that they are receiving directions from outstanding businessmen like President Barack Obama and we are praying that this formula will be a successful one for GM. I don’t think so. What do you think?

I would like to get comments from the management team at GM that have lived in this culture so that I can understand from their standpoint why their quality program has failed so badly throughout the last 30 years (1989–2009). Maybe, just maybe, they think it has been a success and they are proud of what they have accomplished.

Discuss

About The Author

H. James Harrington’s picture

H. James Harrington

H. James Harrington is CEO of Harrington Management Systems, which specializes in total quality management (TQM), Six Sigma, lean, strategic planning, business process improvement, design of experiments, executive management mentoring, preparing complete operating manuals, organizational change management, ISO 9000, ISO 14000, and TRIZ. Harrington is a prolific author, having written hundreds of technical reports, magazine articles, and more than 35 books. He has more than 55 years of experience as a quality professional. Harrington is a past president of the American Society for Quality (ASQ) and the International Academy for Quality (IAQ).

Comments

Quality Methodologies Part Two

In 1988 GM was saying all the right stuff. However, now in 2009, the cold hard fact is that they are in bankruptcy and Toyota is not. Why didn't their quality policy save them? Because they did not walk the talk.
James Kannal
show me the data

GM Quality IS better than Toyota

For the life of me, I cannot understand the continued mantra of mis-information coming out of the American public and media regarding the "perceived" quality gap between GM and Toyota, Honda and others. The evidence simply does NOT back up those claims. If you will look at the latest quality and reliability ratings from JD Power and others you will see that most GM brands rank at or higher than Toyota and Honda in quality and reliability. Who has been recalling the most cars lately? In 2007 Toyota recalled MORE automobiles than they manufactured! These are FACTS, and yet you continue to spew forth "marketing drivel" that Toyota has brainwashed the American public with for years! Go out and drive a new Chevy Malibu or Equinox and compare it to a Camry or RAV4 and tell me which one is built better? Compare a Buick Enclave or GMC Acadia to a Highlander and see if you think the same thing. Or better yet, go compare a Buick LaCrosse to a Lexus ES or Cadillac SRX to the Lexus RX and you will find that your "perceptions" of the gap between Toyota and GM will "evaporate" into the same hot air that you have used to try and substantiate them. Didn't Buick just "dethrone" Lexus at the top of the reliability and dependability ratings? People like you who are stuck in the past lamenting the cars GM was building a quarter-of-a-century ago as "evidence" of GMs woes, need to WAKE UP and realize what century you are in!

QS-9000 was a joke...really?

Mr. Harrington, the articles are very good, and timely. Keep it up. I'll reply to the poster of QS-9000 was a joke. ...really? I am an auditor and consultant in the the quality field. I watched quality go from 5000+ ppm to 100 ppm to 10 ppm to now most of my clients are at 0-5ppm consistently. Delivery went from <90% to consistent 99.999% every month. All in about 15 years. Not every supplier is at these levels, but thousands are. The vast majority have improved dramatically. Not a joke, at all. However, the far greater dilemna is that the Detroit OE's did not fully embrace ISO and QS-9000 internally. They got their certificates, but never embraced the culture. That is where the issues mainly lie. PS: QS-9000 was replaced by TS-16949 in 2002. Since your post mentioned QS rather than TS, I assume your experience with the quality program is quite dated.

GM Quality Lives In My Garage

I listen to all the carping about poor GM quality and wonder why have I had such a dramatically different experience? After growing up in a MOPAR household as my parents owned 13 Dodges in a row because of a family friendship with a dealer, I thought I was destined for a life of Dodge ownership myself. Then the dealer made a fatal error in judgment that caused the entire family to drop him like a rock. We tried a Ford only to be even more disappointed, not by the dealer, but by lack of product quality. Things like stainless steel brake lines corroding completely in less than 10,000 miles, four times in a row. Poor design, you bet. The factory tires not lasting to 10,000 miles even though they were properly inflated and well-maintained. Various other issues were also prevalent.
I switched to GM and have not looked back except to occasionally reminisce about the “bad, old days.” I have since owned seven GM vehicles and have amassed nearly 900,000 miles with very few issues. A Chevrolet Camaro Z-28 provided over 300,000 miles in ten years with only normal wear and tear items before it was sold so we could get a Safari minivan for our budding family. It returned over 150,000 miles before it was traded in 2007. My first four GM vehicles each provided over 150,000 miles before they met their next owner. I found the key to be routine maintenance. Change your oil at suggested intervals. Don't buy cheap gas. Pay attention to your tires. Listen to your car and feel what it is doing. Don’t mash the gas when pulling away from a stoplight or standing on the brakes when you need to stop. Common sense goes a long way but many folks seem to have either missed that lesson or forgotten it over time. I remember while I had my Z-28 being asked to give a ride to a friend when they dropped their new Honda off at the dealer to correct something that should never have made it passed the dealer in the first place, let alone the factory. I ended up giving six round trip drives in ten weeks for the same issue. I think the perception of Asian cars having better quality is more prevalent than reality. American-bashing seems to be in vogue these days for some reason. I just speak with my wallet. I am concerned about how much of a role the government will play in transforming the company as I believe the government has the absolute worst quality service anywhere.

Harrington's Article

Great stuff - sad, but oh so true. I hope that some GM execs respond with a truthful, non-BS response, but I know they won't. Good job Jim in doing your part.

GM Quality

We had to replace the transmission in our 1997 Chevy Venture van at about 50,000 miles.

I bought my first Toyota, a Sienna van, about 3 years ago. Loved it, but it has 1 and only 1 design flaw, imho: it is possible to knock the gearshift out of position while reaching for the radio controls. However, they did put some radio controls on the steering wheel.

PS, QS-9000 is a joke

It prescribes a host of busywork for the entire supply chain which can all be done with no impact on quality or productivity, not to mention the people who sign the PSWs rarely, again imho, really know what it is they're signing. And why would anyone rely on a registrar ("not" a stakeholder) to evaluate their suppliers? I doubt the Big Three have ever had a robust subcontractor qualification program, and I raised an eyebrow a few years ago when GM or Ford's new Purchasing Czar implemented a number of admittedly radical, proactive and clever changes to supply chain management, touting the urgency of breakthrough thinking - the kind of thing Toyota has done for decades.

GMs Customer Focus

To say that GM lacks customer focus is, to me, an understatement. To me it seems they have a complete disregard for the satisfaction of their customers. I experienced what seemed to me an unreasonable fault with my Chevy, and more recently, so did my Mother. In each case, I took the time to write a letter to General Motors, explaining the problem, and asking them why they thought this was acceptable quality. I did not receive any response from the first incident. I received two letters after the second, however neither letter referred my problem. Rather, each of the letters simply assured me, as a "valued" customer, that GM would weather this economic storm, and that I could count on them being there in the future. Huh? I don't want them there in the future. I want them to go out of business, like any other company would that treated its customers so.

GM Management

In my experience with a Tier 1 supplier, the thing that struck me about GM was the almost complete lack of cross-functional coordination. It frequently seemed to me that at GM, the left hand did not know what the right hand was doing. It was very common that I would be given conflicting directions from different functions within GM, even to the point of having the same terms defined differently by different functions. I found myself educating GM personnel about the practices of other functions and pressuring them to contact their coworkers to coordinate requirements.

I suspect that these experiences illuminate a deeper problem within GM, and perhaps one of the root causes of their quality problems: GM's senior leadership has been unable to manage and coordinate relationships within the company, leaving it to lower-level personnel to overcome these differences on a case-by-case basis. As a result, GM is a patchwork of personal networks, each with a unique set of goals and operating methods. It is as if GM makes cars only because everyone arrives at work each day expecting to do so; not because of any deliberate or coordinated alignment. In such an environment, variation in results, and hence poor quality, would be unavoidable.

GM Quality

I was working for a supplier of GM's around the time you conducted that interview, and have to say that the great word from GM at the time was "MAP", not "Quality". Does anyone else remember MAP? It was an ill-conceived attempt at factory-floor communications technology, which collapsed under the weight of its own contradictions. Ethernet won, since it was cheap, standardized and reliable. Later, GM's great word became "QS 9000" - a good starting point, since strong systems can lead to good results. But they never required the results, nor the improvement in results that could have lead to an improvement in their quality and warranty costs. So compare the quarterly warranty costs (as a % of sales) of the Big Five automakers for the years 2003 to 2006 (data from Warranty Week, June 20, 2006) :-

GM 2.6% - 3.3%
Ford 2.25% - 2.7%
Daimler-Chrysler 2.7% - 5.2%
Toyota 1.2% - 1.3%
Honda 1.2% - 1.65%

Is there any doubt that Toyota and Honda are operating different Quality processes than GM, Ford and (especially) Chrysler?

Guy D Gimson
Quality First LLC
Charleston, SC

Item 4: Quality

I find your comments about GM products being designed with parts that break down after 20,000 miles to be far from my own experiences with my last 5 GM cars, 2 Chevrolet Camaros, 1 GMC Jimmy, a Buick LeSable, and my current vehicle, a Buick Ranier. Both Camaros were driven over 100,000 miles with no parts failures, only replacing brake pads and tires. I had a breakdown on my GMC Jimmy at 155,000 miles when the heater core needed to be replaced. I drove the LeSabre for 90,000 miles and had zero breakdowns and was still getting 32 - 34 mpg on the highway. My Ranier has 47,000 miles on it and I have had no parts breakage to date. My Toyota, Mercedes, Nissan, and Volkswagen driving friends talk about their great cars, but when we talk about frequency of repairs, they almost always have had problems. Perhaps my experience is unusual. After having owned six imports, I must say that my experience with GM products has been more satisfying. Even my son-in-law remarks how much nicer my Buick Ranier is than his Toyota SUV - and more reliable.